STARBUCKS

Starbucks



Starbucks

Introduction

Starbucks has been around for the past few decades and is well known throughout the world as being the specialty coffee company. Although it started out in America, it now operates in 36 countries in over 11,000 stores and caters to its customers with the help of around 10,000 employees. The economic industry under which Starbucks currently operates has done wonders for the brand, and it recently expanded into Japan. Now, there are plans to overtake India as well, since the sales figures continue to be astounding and the business is doing so successfully. In this paper, I will be analyzing the current business environment under which Starbucks operates and will be analyzing whether or not it faces any economic threats.

Discussion

Currently, Starbucks is in the process of implementing business strategies that allow them to be the first coffee company to enter the international market in India. Since there is such a growing trend for Western brands in the South Asian market, this might be a strategy that has a blooming effect on the economic structure of Starbucks. Furthermore, coffee and tea consumption is a strong-suit of these countries, thus the research that goes into marketing strategies as well as forecasting, is likely to be in the positive. Entering the Indian market also gives Starbucks a head start, since earlier brands have tried and failed but Western brands are trending currently in that region of the world. Starbucks aims to utilize a differentiation strategy, as they offer specialty coffee at a premium price, competitors are not able to imitate this. Furthermore, the growth strategy of Starbucks which is to expand into foreign markets seems to be working out very well for the brand so far. Countries such as Saudi Arabia, England, and Japan and so on are all embracing the Western brand, especially since it offer such a large variety to choose from. The current plan of expansion into India is a great strategic move because it capitalizes on the current business trends while remaining true to its current business and growth strategy. Being the fourth largest economy in the world, it is also luckily a great consumer of caffeine, thus India would make a perfect target for expansion of the brand. A horizontal integration strategy could help Starbucks gain leverage in the foreign market, but since it is already so well known the world over, the plan is to capitalize on that.

In the current industry for coffee, the biggest threat to the brand is that of substitute products, may they be local or international. Premium foods or even the fast food industry is facing the threat of new entrants more than ever, since inflation from the global economic crisis of 2005 is slowly diminishing. Starbucks needs to realize and research upon ways that its substitutes like tea and organic brands don't overshadow coffee in a land where Tea is one of the natural homegrown products. It needs to satisfy customers with its range of flavors and its ...